Skip to main content
7:00 pm
7:01 pm
tonight on "the kudlow report," the washington snowstorm shut down congress. but ben bernanke released his new testimony, anyway. investors caught a chill on the news, and distinguished money expert john taylor has his own expert strategy rebuttal to bolster ben's manhood. you don't want to miss this one.
7:02 pm
they're bearing gifts to the greece bailout problem. will the bailout issue ever end? google is at war with china and now they're being thrown out of iran. they think they can stifle free speech, but i think the old human desire for freedom and democracy will still win out in the end. has obama flipped out on greedy bonuses and business support? well, liberal columnist paul cra craigman is horrified, he thinks we're doomed. fasten your seat belts, everybody, "the kudlow report" starts now. good evening, everyone. i'm larry kudlow. welcome back to "the kudlow report" where we believe free market kamt capitalism is the b path to prosperity.
7:03 pm
our lead story tonight is fed head ben bernanke's leader to congress. how is he going to stop the zero interest rate monetary explosion? how is he going to do it? in just a few minutes, steve leishman is going to have the details and our money expert will have his blueprint. how have financial markets, including stocks, become totally addicted to the fed's interest rate and huge money buildup? and when the time comes for an exit strategy, whenever that is, is there a stock market train wreck comment when the fed finally reelz in all that money stimulus. stocks got the jit ters this morning as soon as the testimony was released. that could be a harbinger of future problems. this must be one of those storm
7:04 pm
cloud issues that all of us must think about and keep our eyes wide open. gold has jumped almost 40% since late 2008 when the feds started pumping the money in by about $5 trillion. so far stock markets have cheered the fed. but what happens when that cash is drained from the system? it could be a market problem, a major market problem. it could be an economic recovery problem, a major recovery problem, and if they don't drain the excess cash, if they don't do it, then we could have a major inflation problem as well. fed head ben bernanke's testimony was canceled today due to snow, but his testimony was released, anyway, as i said. we've got senior economics reporter steve leishman. he's got the full report on the fed head's prepared remarks. >> reporter: thanks, larry. this was a significant speech on fed policy from fed chairman ben bernanke that details how the fed will eventually get out of
7:05 pm
the easy monetary policy and put together in times of crisis. he spoofed that the exit strategy meant those strategies would happen sooner than they thought, but they seemed to take bernanke at his word that no tightening of policy was imminent. he said he would probably raise the discount rate, the rate charged to banks at the emergency lending window, and would probably do so before too long. and the new target for fed policy to communicate where it's going is going to be the interest on that $1 trillion of fed reserves. the fed might also target the reserve balances that were out there, something the fed hasn't done since the '80s. he said these changes do not signal a monetary change in policy. he said they're about where they were when the fed met in january which he said would stay low for an extended period. he was supposed to deliver this speech at a congressional hearing today that was canceled because of the snow, but the fed clearly felt the message
7:06 pm
significant and urgent enough that they went ahead and released the testimony, anyway. that means changes could be happening sometime soon. back to you, larry. >> thank you for that rundown. ben bernanke was not the only one sil ensed by the snow in washington. john slater was also to testify this morning. he joins us now to talk about his testimony and his advice for a fed exit strategy. welcome back, john. you're lucky to be in the sunshine. >> that's for sure. good to be back, larry. >> before we get to the details of your own testimony, you have some very interesting ideas for how the fed should proceed. i want to just go back to what's on the minds of a lot of investors. number one, in your judgment, are the stock markets totally addicted to ultra-easy money and a zero interest rate. and number two, john, whenever this exit strategy comes about, whenever the cash is drained and the rates go up, is that going to cause a stock market train wreck? >> you know, there's a factor in
7:07 pm
the current strength in the markets during the last year, absolutely. but i think as long as the fed is clear that they're going to raise rates when it's time, if you like, i mean, there's been concern that there's been no indication at all in this testimony about when they will do that or even a strategy for that. i think that's what's really needed right now, and to prevent the kind of train wreck that you're worried about and i think others are worried about, it's important to lay out that strategy, if you like, not just give another list of what the tools are. >> one of the disappointing elements of bernanke's testimony, at least from my standpoint, is he said very clearly they're not going to sell any bonds to withdraw cash. that if they do that, it's coming way later. instead they want to use the interest rate on excess bank reserves held by the fed and, in fact, that interest rate may replace the fed's fund rates target, the traditional tool. what's your take on all that and
7:08 pm
what's it all mean? >> it would be a bad idea to replace the traditional tool, eventually, in the long run. as they begin to raise rates, they may have to use that interest rate on reserves to do that because they've flooded the market with so many reserves, the interest rate is basically hoverring around zero for that reason. what they're trying to do is keep the reserves out there and raise the interest rates, really, so they can still have this large portfolio of mortgage-backed securities. >> but john, raising rates on excess reserves, that's fine, but that's kind of a flow. it's like a little tributary. this balance sheet is still up $1.5 trillion from late 2008. you have a simple exit rule, as you call it, from your testimony which really to me sounds much more convincing and decisive. can you walk us through it? >> sure. i think it's important to think of an exit strategy as a description, at least in general terms, of what the instruments or tools are going to be doing, so i call it an exit rule.
7:09 pm
look for an exit rule, and that rule has a way that you're rolling down, bringing back reserves at a pace that's similar to the pace as you raise the interest rates. so when they begin to raise rates, they also reduce reserves, and by my calculations, if they do that by the way i described, they'll be back to normal operating business by the time the funds rate reaches 2%, whenever that is. >> so let me get this right. in your testimony you say, each quarter of a point increase in the traditional fed funds target rate, each 25 basis points, should be accompanied by at least 100 billion of cash drained from the financial system? is that right? how would that work? >> that's exactly right. so when they would vote, whenever they do it, to raise their target, they would also vote to reduce reserves by -- i estimated 100 billion would be a good place to start. then if, say, three months later they raised the funds by another 25 basis points, around that
7:10 pm
time they withdraw another hundred. they do it smoothly. of course, you wouldn't do it any one day. the new york trading desk would be given the discretion to make that decision. but if you do that, and make it clear to people. it doesn't have to be as precise as i'm describing, but in general terms, make it clear to people so that traders in the markets can start to price securities better, then ichk you'll be back in business as normal trading policy which we want to get back to as soon as possible. >> i think this is a totally different approach to the one mr. bernanke described. you're saying use the tradition fed funds target rate tool and drain $100 billion out for every quarter of a point. in your testimony you say if the fed funds rate goes from zero, where it is today, to 2% in some period, that would take out $800 billion, more or less half of what the fed injected. now, john, that is completely different than what bernanke --
7:11 pm
bernanke says, we need to take out money, but he has no plan to take out money. he wants to take out money without draining cash -- he says we're not going to sell bonds. and i don't understand how you can strength their balance sheet, which is potentially inflationary, without doing the kind of work you're talking about doing. where does bernanke have it wrong? >> i hope they do that. they don't have to do it the way i'm talking about it, to be sure, but that's what an exit strategy is, it's what you're going to be doing, not just a list of the things you may or may not change. >> so let me get this right. how quickly would you take zero to 2% on the funds rate and how quickly would you take out the $800 billion in cash? >> the zero rate would be over time. hopefully if the economy picks up, it would move more quickly. we'll see the data that comes out this year.
7:12 pm
hopefully you don't get behind the curve. they'll be raising the rates event wael, and when they do that, they'll be bringing out these reserves, too. the nice part of this idea is it's something the markets could understand what they were going to do. bank reserves will be coming out at some point. this describes, i think, a flexible procedure that gets to the right point in the end that the markets could digest and at least know what to do. >> here's what i don't get, john. bernanke doesn't want to mess with the fed funds rate, he wants to raise the feds interest rate on the so-called excess bank reserves held at the fed. but, but, but, but -- he doesn't want to take money out. he says, we're not going to take money out of the system for quite a while. maybe some reverse repos, maybe they'll drain some cash, maybe not. what troubles me about bernanke's testimony today is not what happened in the stock market, what troubles me is it's
7:13 pm
a non-withdrawal of federal money. the stock market, on the other hand, doesn't seem to want any withdrawal of excess money and you're saying here's the best way to do it. but bernanke doesn't have a way to do it. he doesn't have a way to explain this. >> there was at least some hope of a description of strategy, but instead it was a list. and we already heard the list, so you don't hear much of that. so who knows, but i think people are at this point, traders i talk to and people in the markets i tour, looking for some description or guideline, simply, of what's going to happen rather than, as i say, another list of the tools. >> john, do you think, because you are concerned about the feds' political independence, and bernanke got roughed up pretty big time in his reconfirmation hearing. all of washington -- and i mean all of washington -- is crazed about the 9.9% on the unemployment rate. is there any plan to take the
7:14 pm
traditional route, raise the funds rate, drain cash so we can prevent future inflation. is there any support for this in washington based on your reading? >> i think a lot of the complaints about the fed is they realized they held interest rates for too low for too long back in 2003, 4 and 5. >> this is your criticism. >> yeah. so if that's the concern, they don't want that to happen again. and as long as it's done by a way it's worked in the past well, 80s and 90s for the most part, i think the fed can defend that, and people who criticized the fed can say, that's what we want at this point. we don't want the fed engaged in fiscal policy, we don't want the fed to be involved in bailouts. we want the fed to do the good things they did to keep inflation low and the economy stable in the '80s and '90s. >> so you're basically saying if the markets know what they're
7:15 pm
doing and understand raising the target rate and withdrawing cash at the same time, which are really the traditional tools, nothing fancy, you're saying the adjustment by the fed will not destroy the stock market. is that your point? >> if it's predictable, absolutely. the markets really kraif some security about policy, predictability. right now they don't know exactly what's happening, there isn't really a sdwrat yet, and i think this will be less of a problem zoo bz last question. people are talking about pretty good g.o.p. headquarters, coming up. a, do you buy it? and b, would that be a trigger for the fed? >> yeah, i buy it. some is big inventory in the
7:16 pm
fourth quarter, still going to be inventory in the first corner. i think they could use that and i'll certainly worry about it, but there's a question of how sustainable those high rates are if they're a lot of inventory. >> if i had one wish in life, john, there are many wishes in life that do not get granted. but if i had one wish, i would like a debate on this show with you and mr. bernanke. you are two distinguished doctors. he took cheap shots in that seminar in atlanta, you responded in your positive, low-key way. you're doing the same thing today. you're basically saying, ben, there's a better way to do it. i would like for you guys to debate. it would be more interesting than presidential. thank you for your contribution once again. >> thank you, larry. coming up on "the kudlow report," google fought china and
7:17 pm
now they're fighting iran. the full report, plus it looks like greece is getting everything is desires. germany and france are bearing gifts to grease grease. are they good gifts, are they lasting gifts? businesses and business world, new rule to get us out of the monetary issues. i hope ben listens!
7:18 pm
7:19 pm
hi, may i help you? yes, i hear progressive has lots of discounts on car insurance. can i get in on that? are you a safe driver? yes. discount! do you own a home? yes. discount! are you going to buy online? yes! discount! isn't getting discounts great? yes! there's no discount for agreeing with me. yeah, i got carried away. happens to me all the time. helping you save money -- now, that's progressive. call or click today.
7:20 pm
in a dramatic announcement today on the eve of the 31st anniversary of the iranian revolution, tehran announced a short time ago that it will shut down google e-mail services in the country and will launch a national e-mail service of its
7:21 pm
own. here now is nbc's richard engel. richard, what is this all about, in your judgment? >> well, according to iranian experts we've spoken to and people in tehran, this is yet another attempt by the government to try and prevent protestors from taking to the streets, especially tomorrow. tomorrow is a very sensitive day. as many as 1 million people could be gathered in tehran. there are official celebrations on the anniversary of the revolution, but the opposition movement is also planning on taking to the streets, and one of the ways that the opposition movement has organized is through e-mail, through sms cell phones, and this is one way by the government to try and keep mobili mobilizeres off the streets. >> so your basic free speech crackdown. what about twitter, richard?
7:22 pm
apparently during their protest over the phoney elections, twitter was a big organizing tool. do we know how that's going to be handled? >> all of them are being handled pretty much in the same way right now. for the last 48 hours, it's been pretty much impossible to access the internet in iran at all. this announcement by iran today saying that it is going to permanently cut off google's g-mail service is really impossible to verify right now because people in iran can't access that, they can't access hotmail, they can't access yahoo or any of these, but this shows by the iranian government a long term determination to try and isolate the country and prevent young people, in particular, who use these kinds of twitter and other social networking sites and e-mail to communicate with the outside world and to get guidance on how to organize their protests. >> we have a tough statement from the state department, secretary of state hillary clinton, via pg crowley, her
7:23 pm
spokesperson. let me read this real fast. the iranian government seems inclined to reject citizens, the ability to express themselves freely. that's pretty tough stuff, richard. your thought on it. >> i think she was going to the point you were making just ray minute ago that previous attempts by the government to limit twitter and other web sites have not been successful, and over the last six or semp months, we've seen a flood of internet, c phone and videos, to try and get this information. there are plenty of computer engineers. the students know how to get around the firewalls. they seem to be getting better at it and there's no indication
7:24 pm
of these steps by the iranian government will be just as funding for new one themselves. quote, we are hearing from users in japan that they're having trouble accessing e-mail. we can confirm a small drop in traffic. we have checked our own e-mails confrontation over sensor ship and so forth. will google take this laying down? do we have any sense of that? >> in this case, the iranians aren't prospering. they're simply filtering out, like you would any other part of the country. so google really has no say in this matter. can they get by by shutting off
7:25 pm
other things that would allow its users to access google? yeah, i would think people at google could get into this kind of sub mers i have game if they're interested. i'm not sure the political -- >> is to there's really nothing google can do here. richard, we appreciate your time very, very much, coming to us from london. there are a lot of news reports that iran is marching on, a lot of talk about exporting the uranium so the big people can take a look at it. in your judgment, is it possible that besides the furniture muslim resolution. is there something bigger here
7:26 pm
at stake? >> well, iran has always used the nuclear issue that distract public within when you have serious dates like the one coming up tomorrow. but iranian officials said they're still willing to discuss this idea of exporting nuclear fuel, so i wouldn't say all bets are off at this stage. there is a little bit of brinkmanship, but iran is still trying to say they want to take a hard line but they're open for a deal. it's not real clear at this stage how far iran is willing to take the nuclear issue. >> thank you very, very much. germany and france is tom coming to greece's issue. what's the impact on stocks? what's the fed impact on stocks.
7:27 pm
a anywhere on the globe. stay with us, we're "the kudlow report." (announcer) if you want directions to the stadium, push here. if you want to see the weather ahead, push here. if you want to access 10 gigs of music you just downloaded to your hard drive, push here. and if you want to pull away from it all, you can push here. the all-new-40-gig hard drive nav and entertainment system
7:28 pm
on the 2010 lacrosse. from buick. it's the new class of world class.
7:29 pm
the european bailout of greece looks to be on the way ask growing. is bailout really the problem or is it part of the solution? peter navaro and the bush
7:30 pm
capital markets, michael farr in washington, cnbc contributes all. andy busch, the more i learn and read about this, the less i am liking it. i just want to put that on the table, because what i think i learned, from late stories out this afternoon, we're not just talking loan guarantees. the european union may be layering on spending sub as i had -- subsidies. >> you don't hear anything about tax cuts, you don't hear anything about cutting regulation. they have major problems with spending in that country, with wages for government workers, with pensions for government workers and one of the other things they have, a major problem that they have is collecting taxes not only for
7:31 pm
the middle class but for the very wealthy. so how about a flat tax? why not go through with something radical and really give your country a chance to grow? >> that is a brilliant idea. that is a nobel peace prize economics kind of idea. economically, that ain't going to happen. they're raising tax rates on rich people and investors. peter navaro, let me come back to this point. what i'm reading here between the lines is this is going to be an euy bailout. yes, there will be guarantees but there will be subsidies. you got spain and portugal and italy waiting in the wings, you got greece, they're not going to cut spending, they are going to jack up prices, and to me this
7:32 pm
jeopardyiz jep jeopardyizes greece. >> you're right, i don't think this is about saving greece, i think it's about saving the euro. i'll make a prediction here that there will not be any new countries for the next five years or more that actually join the euro, and i bet you one or more countries drops from it. so the euro as we know it, i think, is dead because of what's going on here. and greece, for example, might be a likely candidate. i agree with you that europe seems to be following the obama administration and using fiscal stimulus, ignoring any kind of tax cuts, but there is this element, too, about disparate measures -- >> this is bailout nation in europe. there are no spending limitations. listen to me, listen to me. the public unions are demonstrating on the streets. can you imagine this? they are closing down schools and hospitals and airports so
7:33 pm
there is no spending limit. and when i see that, that is the old unionization of europe and england before thatcher put an end to it, peter. when i say that, you are right, buddy, the euro is going down because europe is going down. >> the flaw in the euro, to be clear here, they're supposed to -- when they join euro, they're supposed to get rid of their monetary policy and they're not supposed to run budget deficits at more than 2%. greece is at 13%, larry, in termsz of their gdp and budget deficits. the europeans say nothing about it, it's just this fiscal policy run amok and it's going down. >> there was no fall-through in the stock market today. yesterday we had a relief rally of 150, 60 points on the dow because of the so-called greek bailout. today we had no follow-through.
7:34 pm
we'll get to the fed in just a minute, but michael farr, i don't know, bailout nation in europe? what if the euro keeps going down as peter is suggesting? >> well, then it's going to be a race to the bottom. i mean, we're going to look good by finishing fourth in the fat man's race here. we'll look relatively good. that will be good for us but only because everybody else is in such trouble. i think it's worse than bailout nation, larry. i think this is looking like bailout world, bailout globe. i mean, they even stepped up behind dubai and said, look, it's only going to get so bad. we're not looking at complete collapse here. i don't know how a sovereign nation can legitimately in good conscience give up their control over monetary policy. this is awful. >> andy busch, i'm going back to you. when i see these unions shutting down the country, you're talking schools, you're talking
7:35 pm
hospitals, you're talking airports, that makes my blood boil. that was the old story in the 1970s when the unions used to shut down europe on a regular basis ask tried to do so here before margaret thatcher and ronald reagan put an end to it. but we are now learning there will be low guarantees and possible spending subsidies. peter says the euro is dead, and i want you to weigh in on what he's saying. is the euro dead? >> i agree with a lot of what peter says, but no, the euro is not going to be dead. there is too much at stake even for countries like greece who benefited much by having them move so much lower. everybody benefited because of its link to germany.
7:36 pm
i agree the euro is going to continue to weaken for some time here -- >> quick question, andy. do you think there will be any new countries joining the euro -- >> no. >> -- and do you think any will drop out? >> i think that's a great point. no way will new countries get into it because they don't want to risk another greece. that could just postpone it. there is a lot at stake for these countries who have joined this union. they will fight pretty much to the death before it blows up. that doesn't mean they can't kick somebody out if they were just plainie auto greej us. but i think overall, this situation will calm down, but larry's point is really good. they're not going to get growth anywhere near the united states because of these tap a policies. >> what about standing on your
7:37 pm
own? everybody wants germany as a stronger partner. how about starting to your own and having your own flee market here. >> the greeks have not stood on their own since the battle of sparmopoly. that is the last time the greeks stood alone, and i will make that assertion. michael farr, a couple things. you got a headline that the fed exit strategy says chills down the stock market spine. that was some of the headlines on market watch and other financial aegsz. >> sure. >> first of all, i don't think they really published an exit strategy today, but i want to ask you a question that i asked the distinguished john taylor. if and when the fed does reel in its monetary stimulus, is that a stock market train wreck? >> yes. i mean, i don't know about a train wreck, but it's certainly going to be a fairly big downer,
7:38 pm
larry. they can't allow this, they don't seem to have the position to do that. right now the real end user demand, the consumer is not expanding its consumption of goods and services. they take that away and yes, the stock market heads south big time. >> what about your theory of the stock market? what is the economic impact on the recovery and the stock market? >> yes, that would affect this as business negatively, but if you cut business taxes, the net gain in terms of assessment would go up dramatically. it's got to be coordinated, and the problem with people like
7:39 pm
bernanke, they just think in terms of this big silo rather than seeing the big picture. another thing, and you had it right in your remarks, bernanke is dealing with a flow of money, with a littles bit of faucet. he's not dealing with the stocks and balance sheets. the three things he put in that speech was an attempt to reduce that balance sheet. taylor -- what about matching money supply to a how about some monitor age. >> what happens if the euro falls -- the euro was down a little bit today. it's gone to about 127. i can rule any of that out. reading what i read today's
7:40 pm
grease, europe relying on more spending. if the euro keeps falling, andy busch, what does that mean for the fed and for our economy. it will helps foreign dresk hopefully that the fed is doing something right. because that's the only way the euro is going to go to 1.10, is if they manage this very difficult situation they have. it actually could be a boon to former investors in the united states. >> the new york capital is going to move to the us airways. you still have, in the short run. you've got sdpleer row interest rate that's the bottom of that curve and you got a 40% bond at
7:41 pm
the top of that curve. today was an unmitigated. that easy money has to be pull bull lish for. never in the history of greek par they no one had that not been positive for the stouk market. do i still have a little run on the stock market cake? >> i think these residents may actually be if we saw and held at banks that will also fall and not make those banks as attractive and not make those yield spreads quite as profitable if they have real asset concerns. i think the asset concerns can still develop a real bull market
7:42 pm
run. >> the rest of this story is terrible. president bush, michel far. does he have any clue about what american heart's -- next year obama actually had some nice things to the about but does he really get it and why is he going there?
7:43 pm
7:44 pm
7:45 pm
washington, d.c. may be buried under the snow and official business cloegsed, but that didn't stop the financial clashes. >> as you know, the snowstorm has basically shut down washington all week, but it's a good moment to sit back and reflect what's happened to president obama over the last year. if you look at the numbers on the cbs poll, you can see how he's handling the country.
7:46 pm
a 5% edge on the first one. they have a huge administration to do in advance of elections. he tried to make a case that the economic situation would be much worse without the steps the add manipulation has taken. ben bernanke says the cost has dropped to $120 billion. the banks have been able to raise another $140 billion in capital, another $60 billion in debt. so larry, the political argument the administration has to make is tough when unemployment is so high and economic conditions are so weak, but that's what they're trying to do to push back against these political trends favoring the republicans. larry? >> mr. harwood, thank you very much. why isn't washington doing what
7:47 pm
the people really want? look at this. bob schrum, my old friend on the top. john fund, the gentleman on the bottom. john fund, it isn't just the unemployment rate. does washington know what folks in the country really want? isn't that the big political problem here? >> yes. and i think for most of 2009, they decided the country wanted health care and the country shrugged and said, no, not really. we're worried about our jobs and the jobs of people we know and love. right now i think they've finally gotten the message, but it took massachusetts to do it. >> bob schrum, i want you to weigh in on this. you saw scott brown, he said people wanted more money in their pocket, people were angry about all these deals around health care, ben bernanke got his take, mary landrieu got her take. isn't that exactly what the public does not want, bob?
7:48 pm
>> yes, but 60% in this country want health care reform and the president will pay a price if they block it. the greeks defeated the entire persian empire, and in world war ii, they held off ger long enough to stand on their own. >> the greeks defeated the persians to they armopoly. they stood at the battle of thalamus. it was a critical event which saved democracy and the greeks did it on their own. >> what kind of hole has obama dug himself into on health care, on taxes and on big government tea parties? my thesis is washington is not giving the voertters and the taxpayers what they want, and that's why mr. obama's polls are
7:49 pm
hemorrhaging. >> here's what they want. they want economic recovery. 84% of them in a poll said they were still in a recession. but obama's highs, and i think he's at his low point, is more than at any other time. you're going to see obama's numbers rise. >> the bankruptcy of the republican strategy, john fund. real quick, last word. you guys are coming back, but let's finish this here. the strategy, john fund? >> all i can say is the poll was all adults. >> no, you're wrong, it's registered voters. it's not all adults, john, you're wrong. >> it's actually both. >> the numbers we're talking about is registered voters. >> but you don't deny the gap is narrowing big time, and it's going to be a real horse race. >> i'm going to raise the second issue. i want to talk about paul
7:50 pm
debate with obama. i think with mr. schrum's history, we'll get through thermopoly. stay with us. we'll be back. here's a little trick i picked up
7:51 pm
7:52 pm
by booking my family trip with expedia. first i find the flight i want. then a great hotel my kids will love. yeah. but wait... here's the really cool part. when i book them at the same time... voila! i can save up to 450 bucks. and we all know that can come in pretty handy. book flight and hotel, and save more. where you book matters, expedia.
7:53 pm
♪ dot com has obama gone soft on so-called fat cats and their bonuses. he's speaking of the bonuses of j.p. morgan's ed diamond, and he said, quote, i know both those guys. they are very savvy businessmen. i, like most of the american people, don't be grudge people their wealth. couldn't have said it better myself. the only trouble is little more than a month ago he called them all greedy fat cat bankers. let's go back to john schrum, let's go back to john fund. john fund, paul krugman read this and said, oh, my god, we're doomed. why is obama koezying up to the bankers and ignoring the
7:54 pm
rhetoric? >> i think the anti-business rhetoric of this administration has often led to unfortunate results, so i guess the president's message is, if you know him personally, and he convinces you you're savvy, i guess you'll be fine with your bon bonus. but there is another reason i think the president did this. remember, he expanded dramatically the federal bailout of fannie mae and freddie mac in the depth of the christmas season. their top executives are getting up to $6 million a year in bonuses. >> i understand that, but that's beside the point. it just so happens he's been meeting with john bainor. bob schrum, i want to ask you, do you agree with paul krugman that cozying up to businessmen says, oh, my god, they're
7:55 pm
doomed. >> no, and i disagree with what john fund justed, the snarky response of what they're doing. he's not going to give reform and the notion that we can't ha have banks that are too big to fail so we have to bail them out. he's in a tough spot, as anybody would be, to explain to the american people that these bonuses are actually relatively small compared to shows in the past would be a very tough sell. he knows what the country wants: economic recovery. we're not going to get it. that's all he's saying. >> so you disagree with paul krugman. we're not doomed? >> no, i think we're on the verge of a big economic recovery. >> john fund, thank you very much. john schrum, thank you very much. coming up -- i don't think we're doomed, but washington isn't
7:56 pm
failing in business, either.
7:57 pm
7:58 pm
i'm so dplad glad that president obama has not said we're doomed, but if you want to do us any credit, lower your business loans, large and small.
7:59 pm

tv
The Kudlow Report
CNBC February 10, 2010 7:00pm-8:00pm EST

News/Business. Larry Kudlow.

TOPIC FREQUENCY Washington 12, John 7, Us 7, Ben Bernanke 7, Iran 7, Google 5, Michael Farr 3, Paul Krugman 3, Bob Schrum 3, Tehran 3, Andy Busch 3, Steve Leishman 2, Expedia 2, John Schrum 2, John Taylor 2, Peter Navaro 2, Obama 2, China 2, Bernanke 2, New York 2
Network CNBC
Duration 01:00:00
Video Codec mpeg2video
Audio Cocec ac3
Pixel width 704
Pixel height 480
Sponsor Internet Archive
Audio/Visual sound, color


disc Borrow a DVD of this show
info Stream Only
Uploaded by
TV Archive
on 9/2/2011
Views
113